Nippon Steel is prepared to make more investments in coal mines after the energy source surged in price, with Japan’s biggest steel-maker looking at ways to stabilize the supply of one of its key raw materials.
International prices of coking coal, the variety shoveled into blast furnaces to manufacture the alloy, have spiked to unprecedented levels in the wake of Russia’s invasion of Ukraine. At the same time, Japanese steel mills, most of which are reliant on imports, are grappling with ballooning costs after a dramatic slide in the value of the yen.
It’s a dynamic that has led Nippon Steel to study whether investing further in coal projects makes sense, particularly as miners come under pressure to divest those assets because of fears over global warming, Kiichi Yamada, the general manager of the company’s raw materials division, said in an interview in Tokyo last week.